Asian volumes recover slightly but trend is still downward

Asian equities volumes rose slightly in November to US$1.31 trillion, from a 12-month low of US$1.19 trillion in October, according to data vendor Thomson Reuters’ Equity Market Share Reporter.

The swing marked a marginal recovery from the US$600 billion regional fall after anomalous highs in August of US$1.8 trillion, but nonetheless volumes were down almost US$1 trillion, or 42.9% year-on-year, from US$2.3 trillion in November 2010.

In Japan, volumes sunk to a two-year low of US$279.75 billion after an August spike of US$441.6 billion. On 22 November, the Tokyo Stock Exchange (TSE) and the Osaka Securities Exchange (OSE) announced a much-delayed merger – set for 1 January 2012. With a combined value of US$3.6 trillion, the new Japan Exchange Group would leapfrog the London Stock Exchange to become the world’s third-largest bourse operator behind the US’s NYSE Euronext and Nasdaq OMX.

SBI Japannext was the largest alternative trading system in the country, trading 2.51%, or US$7 billion, worth of Japanese of liquidity in November. Chi-X Japan suffered a drop in market share last month to 2.07% (US$5.79 billion traded) from 2.31% (US$7.15 billion) in October.

As the Australian market experienced its first full month of competition, with the introduction of alternative venue Chi-X Australia on 31 October, a steep fall in volumes from a 12-month August high of US$132.76 billion, slowed. Month-on-month, volumes fell 3.43% to US$85.94 billion, from US$88.99 billion in October. The new Chi-X Australia venue registered a market share of 0.01% in its first month of trading, which also saw the launch on 28 November of the Australian Securities Exchange’s new low-latency trading platform PureMatch. The new ASX order book has been set up for trading the most liquid ASX-listed stocks and domestic exchange-traded funds.

Singapore’s exchange saw volumes fall to US$12.99 billion from US$15.04 billion in October – a drop year-on-year of 34.6% from US$19.86 billion in November 2010. The fall in volumes came in a month where the Association of Southeast Asian Nations (ASEAN) exchanges revealed the Singapore Exchange and Bursa Malaysia would be the first bourses to be linked together by a new ASEAN trading link, set to go live as early as June 2012.